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Friday, October 4, 2013

NEW YORK – The stunning array of charges against William
Rapfogel, the disgraced former head of the Metropolitan Council on Jewish
Poverty, should prompt Jewish organizations to engage in soul-searching and
make governance changes to avoid similar misfortunes, say experts in non-profit
management and ethics. But that, they say, isn’t happening.

Charming and savvy, Rapfogel was arrested September 24 and
charged with grand larceny, conspiracy, money laundering and tax fraud for
having allegedly stolen $5 million over his two-decade-long tenure as chief
executive officer at Met Council, the premier anti-poverty organization working
among New York's Jewish community.

According to the indictment, in August investigators
found some $420,000 in cash stashed in Rapfogel's apartment and upstate New
York vacation home. He is out on $100,000 bail (paid in cash) pending his first
court date in January 2014, said Andrew Friedman, a spokesman for the state's
attorney general.

Rapfogel’s arrest – and the extensive charges against him –
left the local Jewish community, where he was widely viewed as an exemplar of
effective leadership, stunned. “I don’t know of another case in the non-Jewish
or Jewish community where people were so adoring of someone and then so
disillusioned,” said Naomi Levine, executive director of the Heyman Center for
Philanthropy and Fundraising at New York University.

Moses Pava is a professor of business ethics and dean at
Yeshiva University’s Sy Syms School of Business, and author of the book “Jewish
Ethics in a Post-Madoff World: A Case for Optimism.” He compared Rapfogel to
Bernie Madoff, whom he had met several times before the investment tycoon
pleaded guilty to the largest financial fraud in U.S. history, in 2009. Madoff
“came across as a very trustworthy kind of person, someone you wanted to trust
and believe. It was the same kind of shock when we heard about this,” said
Pava.

“I’d like to believe this will be a wakeup call to the
veteran organizations to think more clearly and to put in place more diverse
leadership,” said Shifra Bronznick, a strategy consultant to non-profit
organizations and founding president of the advocacy group Women Professionals
and the Jewish Community. “But my experience is that it hasn’t been.”

She and other experts say that what allowed Rapfogel to get
away with the alleged scheme over such a long period of time was not only his
persona, but the fact that the Met Council’s power, as in many Jewish
non-profits, was concentrated in the hands of few people.

The alleged deception and pilfering “should prompt
institutional thinking about leadership and responsibility,” said Yehuda
Kurtzer, president of the Shalom Hartman Institute of North America.
“Concentrating power in these organizations becomes a setup for someone to
perpetrate a fraud without a lot of people knowing about it. It’s still
baffling that an agency of this size could have this happen.”

Levine, from NYU, called for increased government oversight
of non-profit organizations that raise more than $300 billion across the U.S
each year. Others, however, said the non-profits themselves must choose leaders
and set governance policies that would prevent what happened at Met Council.

'Parallel universes' for Jewish groups

Bronznick, meanwhile, said that American Jewish
organizations can be split into two groups: There are veteran organizations,
like Met Council, the ADL and other groups that have been in existence for
decades and are not learning needed lessons from the Rapfogel affair. Then there
are upstarts in the innovation sector and among some foundations and fairly
young spiritual communities, which are employing new models of shared executive
leadership – or often women – at the top.

“We have parallel universes,” said Bronznick. “In a lot of
these organizations where we’re seeing some of these scandals, it’s not just
that it’s only men leading the organizations, but the same man who’s been in
place for many years.” Their leadership, she said, “is calcified” and “a lot of
these organizations are declining in power and influence.” Yet there is “a lot
of resistance to change when we’ve brought up the notion that we need to see
more shared leadership.”

Currently, due to retirements, there is a spate of CEO-level
job openings at some of the most important organizations in the Jewish
community, including at UJA-Federation of New York and the Reform movement’s
Hebrew Union College-Jewish Institute of Religion due. There is also a search
underway for a new executive director at the 92nd Street Y, a major cultural
center on New York's Upper East Side, because leader Sol Adler was fired in
July after his longtime extramarital affair with his assistant came to light.

At a time when the task leading organizations is more
complex, “we keep seeing unrealistic job descriptions coming out, and it’s
perfectly clear to me that nobody can really say they can take on all these
responsibilities,” Bronznick said. "Yet we haven’t really explored a model
of more shared leadership."

John Ruskay, CEO of the New York Jewish Federation, whose
impending retirement has prompted a search for his successor, took issue with
Bronznick’s assertions that the leadership of legacy organizations is in any
way stagnant. Examining “issues of governance and accountability are ongoing at
UJA-Federation,” he said. These issues are not new, he said, and “these
discussions continue in light of the allegations” against Rapfogel.

The federation's strict governance policies helped it
largely avoid taking as big a hit as other groups after the Madoff scandal, he
said. “We’ve had among the highest levels of ethical avoidance of conflicts of
any non-profit. We’ve been working for many, many years to strengthen board
oversight.” Emphasizing that the agencies in the N.Y. federation’s network are
all “independent agencies,” Ruskay said, “we’ve been working [with them] to
strengthen fiscal governance.” He declined to elaborate further.

The Anti-Defamation League, headed by Abe Foxman, did not
respond to multiple requests for a response.